diff --git a/README.md b/README.md
index bc8c8905f..841b29150 100644
--- a/README.md
+++ b/README.md
@@ -23,9 +23,12 @@ Table of Contents
     + [From Chocolatey](#from-chocolatey)
 - [Suppressing Rules](#suppressing-rules)
 - [Settings Support in ScriptAnalyzer](#settings-support-in-scriptanalyzer)
-  * [Built-in Presets](#built-in-presets)
-  * [Explicit](#explicit)
-  * [Implicit](#implicit)
+    + [Using parameter Settings](#using-parameter-settings)
+      - [Built-in Presets](#built-in-presets)
+      - [Explicit](#explicit)
+      - [Implicit](#implicit)
+    + [Custom rules](#custom-rules)
+      - [Using custom rules in Visual Studio Code](#using-custom-rules-in-visual-studio-code)
 - [ScriptAnalyzer as a .NET library](#scriptanalyzer-as-a-net-library)
 - [Violation Correction](#violation-correction)
 - [Contributions are welcome](#contributions-are-welcome)
@@ -318,7 +321,10 @@ Settings Support in ScriptAnalyzer
 Settings that describe ScriptAnalyzer rules to include/exclude based on `Severity` can be created and supplied to
 `Invoke-ScriptAnalyzer` using the `Setting` parameter. This enables a user to create a custom configuration for a specific environment. We support the following modes for specifying the settings file.
 
-## Built-in Presets
+## Using parameter Settings
+
+### Built-in Presets
+
 ScriptAnalyzer ships a set of built-in presets that can be used to analyze scripts. For example, if the user wants to run *PowerShell Gallery* rules on their module, then they use the following command.
 
 ```powershell
@@ -327,7 +333,7 @@ PS> Invoke-ScriptAnalyzer -Path /path/to/module/ -Settings PSGallery -Recurse
 
 Along with `PSGallery` there are a few other built-in presets, including, `DSC` and `CodeFormatting`, that can be used. These presets can be tab completed for the `Settings` parameter.
 
-## Explicit
+### Explicit
 
 The following example excludes two rules from the default set of rules and any rule
 that does not output an Error or Warning diagnostic record.
@@ -362,7 +368,8 @@ Then invoke that settings file:
 Invoke-ScriptAnalyzer -Path MyScript.ps1 -Settings PSScriptAnalyzerSettings.psd1
 ```
 
-## Implicit
+### Implicit
+
 If you place a PSScriptAnayzer settings file named `PSScriptAnalyzerSettings.psd1` in your project root, PSScriptAnalyzer will discover it if you pass the project root as the `Path` parameter.
 
 ```PowerShell
@@ -371,6 +378,68 @@ Invoke-ScriptAnalyzer -Path "C:\path\to\project" -Recurse
 
 Note that providing settings explicitly takes higher precedence over this implicit mode. Sample settings files are provided [here](https://github.com/PowerShell/PSScriptAnalyzer/tree/master/Engine/Settings).
 
+## Custom rules
+
+It is possible to provide one or more paths to custom rules in the settings file.
+It is important that these paths either point to a module's folder (implicitly
+uses the module manifest) or to the module's script file (.psm1). The module
+should export the custom rules (as functions) for them to be available to
+PS Script Analyzer.
+
+In this example the property `CustomRulePath` points to two different modules.
+Both modules exports the rules (the functions) with the verb `Measure`
+so that is used for the property `IncludeRules`.
+
+```powershell
+@{
+    CustomRulePath      = @(
+        '.\output\RequiredModules\DscResource.AnalyzerRules'
+        '.\tests\QA\AnalyzerRules\SqlServerDsc.AnalyzerRules.psm1'
+    )
+
+    IncludeRules        = @(
+        'Measure-*'
+    )
+}
+```
+
+It is also possible to used default rules by adding those to `IncludeRules`.
+When including default rules is important that the property `IncludeDefaultRules`
+is set to `$true` otherwise the default rules will not be triggered.
+
+```powershell
+@{
+    CustomRulePath      = @(
+        '.\output\RequiredModules\DscResource.AnalyzerRules'
+        '.\tests\QA\AnalyzerRules\SqlServerDsc.AnalyzerRules.psm1'
+    )
+
+    IncludeDefaultRules = $true
+
+    IncludeRules        = @(
+        # Default rules
+        'PSAvoidDefaultValueForMandatoryParameter'
+        'PSAvoidDefaultValueSwitchParameter'
+
+        # Custom rules
+        'Measure-*'
+    )
+}
+```
+
+### Using custom rules in Visual Studio Code
+
+It is also possible to use the custom rules that are provided in the
+settings file in Visual Studio Code. This is done by adding a Visual Studio
+Code workspace settings file (`.vscode/settings.json`).
+
+```json
+{
+    "powershell.scriptAnalysis.settingsPath": ".vscode\\analyzersettings.psd1",
+    "powershell.scriptAnalysis.enable": true,
+}
+```
+
 [Back to ToC](#table-of-contents)
 
 ScriptAnalyzer as a .NET library